Federal tax refunds often represent a family’s single largest check of the year, and next year’s refunds could be even bigger, with the average payment set to increase by about $1,000 per filer, according to a recent analysis from financial services company Piper Sandler.
That could boost the typical refund check to roughly $4,151 per filer, based on IRS data that shows the average tax refund was $3,151 for the 2025 tax filing season. Americans will file their 2025 individual returns in early 2026, with most people receiving their refunds within 21 days of submitting their forms to the tax agency.
The analysis aligns with other forecasts predicting a bumper year for tax refunds, driven by the “one big, beautiful” tax and spending law signed by President Trump in July. The legislation enacted a bevy of new tax breaks retroactive to 2025, including eliminating taxes on some overtime and tipped income, as well as lifting the cap on the deduction for state and local taxes, or SALT, from $10,000 to $40,000.
“When people go to file, they’ll be surprised by really, really large refunds,” Don Schneider, deputy head of U.S. policy at Piper Sandler and one of the report’s authors, said in a recent podcast about the analysis. “In a typical year, we might have about $270 billion in tax refunds, and it’ll be that plus another $90 billion.”
Americans generally aren’t adjusting their withholding to reflect the new law’s retroactive tax cuts, largely because it’s hard for employees to estimate the impact, Schneider added. As a result, when people file their taxes in early 2026, their refunds could be about one-third larger than usual — that amounts to roughly an extra $1,000 per filer, according to the report’s calculations.
“It could be one of the largest tax refund seasons ever,” Schneider added.
Still, the impact won’t be evenly distributed, with the benefits largely going toward middle- and upper-middle-income households, or those earning between $60,000 to $400,000 per year, according to Piper Sandler.
That echoes earlier tax analyses projecting that higher-income Americans are likely to see a bigger relative boost from the new tax law compared with lower-income households. People who earn over $217,000 a year are likely to get $6 of every $10 in new tax breaks from the law, according to a Tax Policy Center analysis published in July.
Some of the law’s benefits won’t reach the highest-earning households because of income phase-outs, Piper Sandler noted. For example, the new $40,000 SALT deduction begins to phase out for filers with annual income of more than $500,000.
The lowest-earning households are also likely to see little benefit from parts of the new tax law. For instance, the higher SALT deduction cap only helps people whose state and local taxes exceed the 2025 standard deduction, which stands at $15,750 for single filers and $31,500 for married couples.
Because filers must itemize to claim the SALT deduction, lower-income households typically can’t take advantage of it, according to tax experts.
“This isn’t going to the very bottom of the distribution. It isn’t going to the very top of the distribution either,” Scheider said.
The Minneapolis City Council is allocating $14 million toward nine affordable housing projects, officials said Thursday.
The city said it’s also giving $1.7 million to two other projects through the Housing Tax Credit program, an initiative managed by the Internal Revenue Service that helps lower taxes for “investors in qualified low-income rental housing.”
According to the city, the money helps add or preserve nearly 600 affordable homes for Minneapolis residents exiting homelessness.
Officials said the $14 million comes from the city’s Affordable Housing Trust Fund, which uses “federal and local funding resources.”
Projects that apply for funding through the Minneapolis program must ensure that 20% of their units will be affordable to households earning no more than 50% of the area median income.
Learn more about the projects that were awarded funding here.
Mayor Jacob Frey during a news conference on Thursday said the city will have 126 new shelter beds and 123 new units for people experiencing homelessness by the end of the year.
“This is a partnership that we’ve got alongside nonprofit partners, the county and the state, because this work does not happen alone,” Frey said.
Minneapolis officials said that, since 2011, the City Council has allocated nearly $183 million from the Affordable Housing Trust Fund toward housing projects.
Earlier this month, the U.S. Department of Housing and Urban Development announced plans to cap the amount of money communities can use for permanent supportive housing in the next round of grants. Dozens of Minnesota nonprofits and advocates on Monday warned the plans could mean thousands of state residents overcoming homelessness will return to the streets.
The IRS is boosting retirement plan contribution limits in 2026, allowing Americans to put more money in their tax-preferred 401(k) and individual retirement accounts.
The tax agency, which announced the new contribution thresholds on Thursday, adjusts those account limits annually to account for inflation. Without these increases, people saving for retirement would have a harder time sheltering income from taxes and inflation.
“The new 2026 retirement plan limits give people more room to save, which is especially helpful as retirement gets longer and more expensive,” Lisa Featherngill, national director of strategic wealth and business advisory at Comerica Wealth Management, said in an email. “Higher limits for 401(k), 457 and similar plans — along with bigger catch-up contributions — make it easier for workers to put away more money each year.”
The new 401(k) and IRA plan limits for 2026 are as follows:
Employees with 401(k), 403(b) and 457 plans, as well as those who participate in the federal Thrift Savings Plan, can contribute a maximum of $24,500 to those accounts next year, up from $23,500 in the current year.
For workers 50 and older, the catch-up contribution limit for these accounts will climb to $8,000 in 2026, a $500 increase from this year’s $7,500 cap.
Annual contributions to IRAs will be capped at $7,500 in 2026, up from $7,000 this year.
The IRA catch-up contribution for people 50 and older will include a cost-of-living adjustment of $1,100, up from $1,000 in 2025.
Even with the IRS raising retirement savings limits each year to keep pace with inflation, many Americans still feel financially unprepared for life after their working lives end. Only about four in 10 say they’re on track to maintain their current lifestyle in retirement, according to recent research from Vanguard.
A Goldman Sachs report published last month found that 42% of working Americans, from Gen Z through Gen X, have no disposable income left after covering basic living expenses.
With so many households stretched thin, relatively few workers can take full advantage of tax-advantaged plans. Vanguard found that 14% of Americans contributed the maximum amount to their 401(k)s in 2024 — a group that tends to be older and earn higher incomes.
WASHINGTON (AP) — IRS Direct File, the electronic system for filing tax returns for free, will not be offered next year, the Trump administration has confirmed.
An email sent Monday from IRS official Cynthia Noe to state comptrollers that participate in the Direct File program said that “IRS Direct File will not be available in Filing Season 2026. No launch date has been set for the future.”
The program developed during Joe Biden’s presidency was credited by users with making tax filing easy, fast and economical. However, it faced criticism from Republican lawmakers, who called it a waste of taxpayer money because free filing programs already exist (though they are difficult to use), and from commercial tax preparation companies, which have made billions from charging people to use their software.
Treasury Secretary Scott Bessent, who is also the current IRS commissioner, told reporters at the White House on Wednesday that there are “better alternatives” to Direct File. “It wasn’t used very much,” he said. “And we think that the private sector can do a better job.”
The Center for Taxpayer Rights filed a Freedom of Information Act request for IRS’ latest evaluation of the program and the report says 296,531 taxpayers submitted accepted returns for the 2025 tax season through Direct File. That’s up from the 140,803 submitted accepted returns in 2024.
Direct File was rolled out as a pilot program in 2024 after the IRS was tasked with looking into how to create a “direct file” system as part of the money it received from the Inflation Reduction Act signed into law by Biden in 2022. The Democratic administration spent tens of millions of dollars developing the program.
Last May, the agency under Biden announced that the program would be made permanent.
But the IRS has faced intense blowback to Direct File from private tax preparation companies that have spent millions lobbying Congress. The average American typically spends about $140 preparing returns each year.
The program had been in limbo since the start of the Trump administration as Elon Musk and the Department of Government Efficiency slashed their way through the federal government. But The Associated Press reported in April that the administration planned to eliminate the program, with its future becoming clear after the IRS staff assigned to it were told to stop working on its development for the 2026 tax filing season.
As of Wednesday, the Direct File website states that “Direct File is closed. More information will be available at a later date.”
The Washington Post and NextGov first reported on the email to state comptrollers confirming the program would not be offered next year.
Adam Ruben, a vice president at the liberal-leaning Economic Security Project, said “it’s not surprising” that the program was eliminated.
“Trump’s billionaire friends get favors while honest, hardworking Americans will pay more to file their taxes,” he said.
As the government shutdown drags on, some federal employees have taken on second jobs to make ends meet. Issac Stein, a furloughed IRS employee, joins CBS News to discuss how he came to own and operate a hot dog stand in downtown Washington, D.C.
Emily Gross, a furloughed worker at the Internal Revenue Service, said many of her colleagues are concerned about how long the government shutdown could last.
Young federal government employees who are just starting their careers are concerned about their ability to pay for necessities such as rent if they miss a paycheck because of the government shutdown, a furloughed worker told WTOP.
Emily Gross, who’s a furloughed government employee who works at the Internal Revenue Service, said many of her colleagues are concerned about how long the shutdown could last.
“A lot of the employees are young,” Gross said, before casting an early ballot at the Fairfax County Government Center last week. “They can’t pay rent if they don’t get one paycheck. They just don’t have that much money in savings; they’re at the beginning of their careers. I just don’t think it’s right.”
The shutdown entered its 14th day on Tuesday, and House Speaker Mike Johnson said earlier this week that it could become the longest shutdown in history. While the Senate returned from holiday break, Johnson hasn’t yet called House lawmakers back to D.C. Democrats are hoping to prevent Affordable Care Act subsidies from expiring.
Last weekend, Vice President JD Vance warned there could be more cuts to the federal workforce the longer the government is shut down. Hundreds of thousands of federal employees have been furloughed during the shutdown, and the situation has also resulted in closed Smithsonian museums and delays at airports across the country.
“Fortunately, I’m safe right now financially, just because my children are grown and my husband has a good job,” Gross said. “But a lot of the people I work with are not, and they’re really, really worried.”
Gross said the circumstances surrounding the current shutdown are frustrating because, “Congress is being paid, and they had no say in this. I don’t think it’s fair. It’s been hard to be a federal employee this entire year.”
The Associated Press contributed to this report.
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The IRS is adjusting the income limits for its federal income tax brackets to account for the impact of inflation, an annual reset that could provide relief for some Americans when they file their taxes next year.
The IRS makes these adjustments, typically in October or November, to avoid what it known as “bracket creep,” which is when inflation pushes people into higher tax brackets, potentially forcing them to dole out more money come April.
The upshot: Americans will have to earn more income next year before reaching a higher tax bracket. For example, the upper tax limit on a single filer making $50,000 will be 12% in 2026 versus 22% in 2025.
See the updated tax brackets below.
Standard deduction
In addition to setting the federal income tax brackets, the IRS also released changes to 2026 standard deductions on Thursday.
Married couples filing jointly will have a standard deduction of $32,200
Heads of households will have a standard deduction of $24,150
Single taxpayers and married individuals will face a standard deduction of $16,100
Seniors could see additional relief due to a provision in the One Big Beautiful Bill Act that provides a temporary tax deduction of up to $6,000 for people aged 65 and older. The tax break, which is set to expire at the end of 2028, is available to those with an adjusted gross income of $75,000 or less for single filers and $150,000 or less for couples filing jointly.
The IRS announced Wednesday that an agency-wide furlough would begin on Oct. 8 due to a lapse in federal appropriations as a result of the government shutdown. Taxpayers with an Oct. 15 extension deadline should plan on submitting their returns as planned, according to the IRS.
“Taxpayers should continue to file, deposit, and pay federal income taxes as they normally would; the lapse in appropriations does not change Federal Income Tax responsibilities,” a spokesperson told CBS News in an email.
Understanding your tax bracket
There’s a misconception that Americans pay the top tax rate on every dollar of their income, but that isn’t the case. Taxation in the U.S. is progressive, meaning that tax rates increase the more you earn. In other words, the seven income tax rate brackets — 10%, 12%, 22%, 24%, 32%, 35% and 37% — represent the percentage you’ll pay on portions of your income.
For instance, a single taxpayer making $50,000 in taxable income in 2026, will pay 10% in federal taxes on the first $12,400 of their income (the top threshold for the 10% bracket) and then 12% on the remaining $37,600.
To determine your marginal tax bracket, you must first figure out what your highest taxable income is.
For instance, a married couple with $150,000 in gross income would first subtract the 2026 standard deduction of $32,200 from that amount, leaving them with $117,800 in taxable income. That would put their top marginal tax rate at 22%. However, their effective tax rate is much lower:
Their first $24,800 of income will be taxed at 10%, or $2,480 in taxes
Their earnings from $24,800 to $100,800 would be taxed at 12%, or $9,120 in taxes
Their income from $100,800 to $117,800 would be taxed at 22%, or $3,740 in taxes
Combined, they would pay $15,340 in federal income taxes, giving them an effective tax rate of 13%.
Mary Cunningham is a reporter for CBS MoneyWatch. Before joining the business and finance vertical, she worked at “60 Minutes,” CBSNews.com and CBS News 24/7 as part of the CBS News Associate Program.
Treasury Secretary Scott Bessent on Monday tapped Social Security Administration Commissioner Frank Bisignano to take on a second role as CEO of the IRS, a newly created position at the tax agency.
The Treasury Department said in a statement that Bisignano will be responsible for overseeing all daily operations operations at the IRS, while also continuing to serve in his role heading the federal agency that administers Social Security.
Bessent said in the statement that the IRS and SSA “share many of the same technological and customer service goals. This makes Mr. Bisignano a natural choice for this role.”
The appointment comes after several recent leadership changes at the IRS, with its most recent commissioner, former auctioneer and congressman Billy Long, stepping down in August after only two months on the job. Unlike previous IRS leaders, Long lacked a background in either accounting or tax law.
Bisignano is a former Wall Street executive and CEO of Fiserv, a payments and financial services firm. In his role as IRS CEO, he’ll report to Bessent, who will continue to serve as acting commissioner of the IRS, according to the Treasury Department.
Bisignano’s appointment to a second high-profile federal job raises concerns about his ability to oversee two major government agencies, according to Social Security advocates, who say that the SSA now faces multiple challenges as a result of the Trump administration cutting thousands of jobs at the agency earlier this year.
“Never in Social Security’s 90-year history has a commissioner held a second job,” said Nancy Altman, president of Social Security Works, in an email. “Bisignano’s new role will leave a leadership vacuum at the top of the agency, especially since the Republican Senate hasn’t even confirmed a deputy commissioner.”
Added Max Richtman, CEO of another advocacy group, the National Committee to Preserve Social Security and Medicare: “Seniors, people with disabilities and their families deserve a full-time Social Security Commissioner. Full stop.”
In an email to CBS News, the Social Security Administration said Bisignano will “lead the day-to-day operations at IRS,” and that his appointment to the role “speaks to the incredible customer service turnaround that is happening at SSA.”
The agency added, “In just five months since his confirmation, SSA is serving more customers efficiently and accurately due to technology and process management improvements. In his new role, Commissioner Bisignano will still lead SSA, along with the incredibly talented executive leadership team he has assembled since his Senate confirmation.”
In the statement, Bessent said that Bisignano “has already made important and substantial progress [at the SSA], and we are pleased that he will bring this expertise to the IRS as we sharpen our focus on collections, privacy, and customer service in order to deliver better outcomes for hardworking Americans.”
Aimee Picchi is the associate managing editor for CBS MoneyWatch, where she covers business and personal finance. She previously worked at Bloomberg News and has written for national news outlets including USA Today and Consumer Reports.
Longtime banking executive and current commissioner of the United States Social Security Administration Frank Bisignano is joining the IRS as its first-ever CEO, according to a Monday announcement from Treasury Secretary Scott Bessent.
Bisignano, whose most recent private sector post was president and CEO of payments processor Fiserv, is also colloquially known as Wall Street’s Mr. Fix-It given his decades of experience of troubleshooting problems throughout multiple large banks. (Bisignano oversaw J.P. Morgan’s mortgage business in the mid-2000’s and was tasked with turning it around after the 2008 financial crisis.)
“Frank is a businessman with an exceptional track record of driving growth and efficiency in the private and now public sector,” Bessent, who also serves as IRS Acting Commissioner, said in a statement. Even with Bisignano joining, Bessent will remain as Commissioner.
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The IRS will “sharpen” its focus on collections, Bessent said, in addition to homing in on privacy and customer service. It’s no secret that interfacing with the IRS is unpleasant. Just Google “IRS paper backlog” for a taste of what the agency is grappling with.
That’s something the Trump administration is looking to tackle: In August, Airbnb co-founder Joe Gebbia shared he’ll be working with the government as a so-called Chief Design Officer. His first project? Improving the online presence of the IRS.
There’s just one thing: Bisignano already has a cabinet-level role in the Trump Administration as commissioner of the Social Security Administration. He accepted that role at the start of Trump’s term.
Which begs the question: How much can Bisignano really dedicate to the agency if he already has his hands full with the Social Security Administration?
While the Trump administration is trying to downplay the overlap (Bessent acknowledged that both agencies “share many of the same technological and customer service goals,”) not everyone’s convinced.
Brian Bernhardt, a partner at Fox Rothschild who focuses on federal tax litigation, says without a full-time IRS Commissioner, the agency will “suffer from poor morale,” and also struggle to keep up with the current filing season, as well as the next one.
“He, like Secretary Bessent will not be able to give the IRS what it needs — a full-time Commissioner focused on all of the day to day needs of the IRS,” Bernhardt says. “While Mr. Bisignano’s business background, and his other service in the administration, indicates he may tend to favor business interests, that’s not a change from Secretary Bessent, the other acting IRS leadership during this administration, or the policies of this administration.”
The IRS has suffered from rapid leadership changes and an absence of clear direction. Seven people served as commissioner from January to August, and if the agency is ever going to dig itself out from under its backlog, its new CEO will have to stick around long enough to steady the ship.
Louie Binda has led an entirely interesting life and is now fully retired and rooting for the Angels, his favorite Major League Baseball team, while enjoying the fruits of his labor.
Binda has worked for the Internal Revenue Service beginning in December 1969 and has coached for multiple decades, working with the girls’ soccer and softball teams at Burroughs High.
If that wasn’t enough, Binda, a longtime Burbank resident was also a longtime teacher and was a successful Parks and Recreation men’s fastpitch softball coach and also coached softball, baseball, AYSO soccer and club soccer.
“I became a coach in September of 1969 [Parks and Rec]. My late wife and I had just been asked to become high school youth counselors for our church youth group. The coach of our men’s church basketball team had been drafted (Vietnam) and we had no coach,” he explained. “In addition, the youth group had six boys, along with some older adults, who also wanted to play. We had too many players, so we made two teams. Most of the guys on the men’s team were better than I was so I played with the youth (B) team and coached both teams.”
Binda, who graduated from Valley State College, now Cal State University Northridge with a degree in Business Administration and an option in accounting, added: “It was hard to coach guys on the men’s (A) team that I had known and played with for years, but the guys were pretty good about it,” he said. “I must have done something right because both teams won their division. Prior to this I had never even considered becoming a coach.”
Binda, who began teaching in the Burbank Adult School in 1972 and ended that portion of his career in 1990, referenced a turning point in his coaching career.
Louie Binda threw out the ceremonial first pitch of the Burbank versus Burroughs softball game at Olive Park to commemorate his retirement. (Photo by Xavier Dubon)
“In 2008, I was ordered to take over the girls’ soccer team just past the middle of the season. I did not want the job because I felt the coach (who I knew) should not have been fired. At that time I was coaching the boys’ freshman team, and I did not want to give that up,” he recalled. “I later found out that the team was in sixth place (out of eight teams), had lost their first game in the second round, and had their two best players out for the rest of the league season. The team had not been to the playoffs in 15 years and had never won a playoff game.”
Binda, who began his tenure as a substitute teacher in 2006 after retiring from the IRS, added: “I got the team to finish in fourth place, qualifying for the playoffs, and we won our first playoff game before we were eliminated. In 2011, I coached the girls’ junior varsity softball team to a 20-0 record. When I was given the team, the varsity coach told me that we would be lucky to win one game that year,” he noted. “We beat three teams that year giving them their only loss. Burbank High had only two losses, both to us, and we beat both of their varsity pitchers. Quite an accomplishment for a team that wasn’t supposed to win a game.”
Being on the field and seeing players improve has been rewarding for Binda, who assisted Mike Kodama as the Burroughs boys’ varsity soccer coach beginning in 1995 and later helped out the freshmen and junior varsity squads and was head coach Brady Riggs’ assistant for the girls’ varsity until 2024.
“I enjoy working with the players, the administrative staff at Burroughs, and 99 percent of the parents are terrific to work with,” he said. “I especially enjoy watching the players work hard to get better, work as a team and then see the results on the field. I love watching the players improve and seeing their confidence soar as they see their hard work pay off.”
Coaches and players need to be resilient and willing to listen to each other, according to Binda.
“Players learn that when you fail you have to get right back up and work harder,” he said. “That by working together as a team, you can accomplish so much more than you ever could as an individual. This applies to the field, the classroom, and especially in life.”
Binda, who was the first-ever Burroughs girls’ soccer coach in 1989, wanted to win just as much as the next guy, but he also wanted players to enjoy what they were doing.
“My philosophy for both are the same – make the students/players winners in life. So many of the lessons we teach and learn on the athletic field apply to what we do in the classroom and in life,” he said. “Work hard to get better. If you make a mistake, learn from it and correct it. When you get knocked down, and you will, get up and work harder.”
Athletes are the same regardless of the year or time, noted Binda.
“The athletes are similar, but the students who are not out for sports are quite different. For instance, before the Internet, all the kids could play baseball, football, and basketball in elementary school. Now, physical education teachers are teaching students how to play these sports in high school,” he said. “In 1961 when I tried out for the “B” football team we had 120 kids try out, and the school had a student body of approximately 1,200 students. Now with a student body of more than double the 2,400 students (2,600-2,800), the varsity football team gets less than half of 120 students trying out, and there is no “B” football. In the end, kids are kids, and I really enjoyed working with them in both the classroom and on the field.”
Binda’s coaching philosophy is sound and proven.
“I feel that patience and good communication skills are critical. Listen to what your players tell you. Communication is a two-way street. Game knowledge is important but not as important as patience and communication skills,” he explained. “You need the respect of your players to be successful, and respect is earned. Every coach has their own way of doing things, so I feel that there is no one way to do things. Be honest with your players. Don’t try to be something you are not.”
UCLA’s John Wooden built a dynasty on the Westwood campus as his basketball teams won 10 NCAA championships in 12 seasons beginning in 1964 and running through 1975 and the Indiana native was quick to note that coaching and teaching are one and the same.
“I totally agree with John Wooden. When I was recruited to become a manager with the Treasury Department the primary reason was because I was already a successful instructor with the Treasury and I was teaching in the Burbank Adult School,” Binda said. “We are telling students/players what we want done and how to do it. You cannot do this without good teaching skills.”
Being successful on the field and on the court isn’t just about skill, although it’s important. It’s really a combination of things.
“Working with players who have talent, but refuse to put in 100 percent effort to improve and instead rely on their athletic ability, eventually they will reach a level where everyone is just as good or better than that player, but because they do not have a work rate, they will not be as successful as they hoped or fail,” Binda said. “This is especially true in life.”
Binda continued his thought: “As a teacher/coach, you have to realize that you are doing the best that you can, and that no matter how good you are or how hard you try, you cannot reach everyone,” he pointed out. “Dealing with some parents can be very frustrating. But as an IRS/adult school teacher/instructor, a soccer referee (for 20 years) and an IRS agent, there is very little that you can say to me that I have not heard before.”
Binda’s advice for teachers and coaches is simple.
“Be honest with your players and be patient,” he said. “Be yourself.”
Rumors spread online Friday that the U.S. government will soon be issuing stimulus checks to taxpayers in certain income brackets.
But Congress has not passed legislation to authorize such payments, and, according to the IRS, no new stimulus checks will be distributed in the coming weeks.
THE FACTS: This is false. Taxpayers will not receive new stimulus checks of any amount this summer, an IRS official said. Stimulus checks, also known as economic impact payments, are authorized by Congress through legislation and distributed by the Treasury Department. Republican Sen. Josh Hawley of Missouri last month introduced a bill that would send tax rebates to qualified taxpayers using revenue from tariffs instituted by President Donald Trump. Hawley’s bill has not passed the Senate or the House.
The IRS announced early this year that it would distribute about $2.4 billion to taxpayers who failed to claim on their 2021 tax returns a Recovery Rebate Credit — a refundable credit for individuals who did not receive one or more COVID-19 stimulus checks. The maximum amount was $1,400 per individual.
Those who hadn’t already filed their 2021 tax return would have needed to file it by April 15 to claim the credit. The IRS official said there is no new credit that taxpayers can claim.
Past stimulus checks have been authorized through legislation passed by Congress. For example, payments during the coronavirus pandemic were made by possible by three bills: the Coronavirus Aid, Relief and Economic Security Act; the COVID-related Tax Relief Act; and the American Rescue Plan Act.
In 2008, stimulus checks were authorized in response to the Great Recession through the Economic Stimulus Act.
The Treasury Department, which includes the Internal Revenue Service, distributed stimulus payments during the COVID-19 pandemic and the Great Recession. The Treasury’s Bureau of the Fiscal Service, formed in 2012, played a role as well during the former crisis.
Hawley in July introduced the American Worker Rebate Act, which would share tariff revenue with qualified Americans through tax rebates. The proposed rebates would amount to at minimum $600 per individual, with additional payments for qualifying children. Rebates could increase if tariff revenue is higher than expected. Taxpayers with an adjusted annual gross income above a certain amount — $75,000 for those filing individually — would receive a reduced rebate.
Hawley said Americans “deserve a tax rebate.”
“Like President Trump proposed, my legislation would allow hard-working Americans to benefit from the wealth that Trump’s tariffs are returning to this country,” Hawley said in a press release.
Neither the Senate nor the House had passed the American Worker Rebate Act as of Friday. It was read twice by the Senate on July 28, the day it was introduced, and referred to the Committee on Finance.
SALEM — The former owner of Red’s Sandwich Shop in Salem has pleaded guilty to tax fraud after failing to pay more than $1.5 million in state meals taxes and causing employment tax losses of more than $400,000, according to the U.S. Attorney’s Office.
John Drivas, 66, who lives in Hampton, New Hampshire, pleaded guilty in federal court on Sept. 6 to five counts of failure to collect and pay employment taxes owed to the IRS and four counts of wire fraud for state meals taxes he collected from restaurant customers but failed to pay over to the Massachusetts Department of Revenue.
The offenses took place over a six-year period between January 2016 and October 2022 at Red’s Sandwich Shop and two other restaurants owned and operated by Drivas — Red’s Kitchen and Tavern in Peabody and Red’s Seabrook in Seabrook, New Hampshire.
Drivas was the sole shareholder of the Salem restaurant until he sold it to an employee in September 2022. He was the 100% owner of the Peabody restaurant with his wife, and the 52% owner of the Seabrook restaurant with his children.
U.S. District Judge Julia Kobick scheduled sentencing for Dec. 5. The charge of failure to pay taxes carries a maximum potential sentence of five years in prison and a fine of $250,000 or twice the gross gain or loss and restitution. Each wire fraud charge is punishable by up to 20 years in prison.
According to the U.S. Attorney’s Office, Drivas collected more than $1.5 million in state meals taxes paid by restaurant customers that he failed to pay over to the state as required by law. In Massachusetts, all owners and operators of restaurants and bars are required to collect 6.25% sales taxes on meals. Salem and Peabody also require restaurants and bar to collect an additional 0.75% local option meals excise tax.
Although Drivas collected the taxes from customers, he intentionally withheld $1,596,775 of those taxes from monthly reports and payments owed to the state Department of Revenue.
Drivas also paid wages to numerous employees of the restaurants partly by payroll checks and partly in cash. He did not report the cash wages to the IRS or pay employment taxes on them, causing employment tax losses of $439,341. Federal tax law requires employers to withhold from any employee wages an amount for income taxes and other amounts for Social Security and Medicare taxes.
Drivas’ guilty plea was announced by the U.S. Attorney’s Office, Internal Revenue Service Criminal Investigation Boston Field Office, and the Insurance Fraud Bureau of Massachusetts.
ANNAPOLIS, Md. (AP) — Maryland is participating in the IRS’s Direct File program, a new free service that will allow eligible taxpayers to prepare and file their tax return online, state and federal officials announced Wednesday.
Comptroller Brooke Lierman said the eligibility qualifications for the program have not yet been finalized for next year, but it’s estimated about 700,000 state residents could qualify.
The IRS experimented with the free electronic tax filing return system this year. In May, the it announced it would make the system permanent and asked all 50 states and the District of Columbia to help taxpayers file their returns through the program in 2025.
The IRS tried the Direct File project for the 2024 tax season on a limited basis in 12 states for people with very simple W-2s, an employee’s wage and tax statement.
The comptroller’s office is partnering with the nonprofit Code for America to build a platform that will securely transfer information from a federal tax return to a state tax return. The office says that will enable Maryland residents with relatively simple tax returns to save time on paperwork and get their refunds faster.
BOSTON — As Steward Health Care prepares to make the case in federal court Wednesday that the deals it reached to sell four Massachusetts hospital facilities should be quickly approved, a number of others would like to have a word — including key lenders for the bankrupt company, the Archdiocese of Boston, and the Internal Revenue Service.
The blur of activity includes ongoing negotiations between Steward and Massachusetts state government over a second, and larger, infusion of public funding that the company says is required to keep its hospitals here open until the sales close, possibly on Sept. 30.
Massachusetts aided Steward with $30 million to stay afloat in August and now is poised to provide the company another $42 million in payments and advances by the end of this week, according to a court filing late Monday.
An array of objections have been lodged in U.S. Bankruptcy Court since Steward announced the hospital sales. A sale hearing is scheduled for 11 a.m. Wednesday, when Judge Christopher Lopez will weigh whether the deals are the best possible way for the company to wind down operations and maximize the value the assets return for its lenders and creditors. Steward says they are and should be approved.
The court is likely to consider an objection filed by the “first in, last out” or FILO lenders that have pumped hundreds of millions of dollars into Steward as the company headed for bankruptcy. Those lenders said they “cannot possibly consent to the proposed sales of the Massachusetts Hospitals in their current form, and they do not.”
“The Debtors’ sale process has resulted in bids for the Massachusetts Hospitals for an aggregate purchase price of $343 million, subject to certain adjustments … However, this figure is misleading as the entirety of the Purchase Price will be allocated towards the real property and therefore flow to benefit the purported landlord (MPT and Macquarie) and more specifically will flow to the purported landlord’s secured lender,” the FILO lenders wrote in the objection.
The objection from the IRS relates to a section of each asset purchase agreement that says Steward has filed all of its tax returns. The federal government says that isn’t actually the case, echoing the way state government was repeatedly frustrated by Steward’s failure to file financial disclosures.
“The United States states that either the terms of the respective Asset Purchase Agreements should be revised to correctly reflect that certain required federal tax returns for certain of the Seller Debtors have not been filed with the IRS and that the applicable Seller Debtor has a legal obligation to file such tax return,” or the court should require Steward to file the returns in question before the transactions close, the U.S. Department of Justice wrote on behalf of the IRS.
The limited objection from the Archdiocese of Boston stems back to the history of many Steward hospitals as part of the Caritas Christi network. The church said its sale of the hospitals to Steward in 2010 was the best option “that would allow the Hospitals to continue to operate as Catholic health care facilities.”
An agreement between the archdiocese and Steward requires the company to return any and all religious items and remove “all symbols of Catholic identity (e.g. interior signage, trade and service marks associated with Catholic identity in both paper and electronic form) and cease using a list of Catholic-related names.
The church said it would object to the hospital sales “to the extent that the Debtors seek to transfer the Restricted Names or the Religious Items or authorize the buyers to continue to use symbols of Catholic identity,” but added that it appears no such transfer is contemplated. That suggests that there will be new names for St. Elizabeth’s Medical Center, the Holy Family hospitals, St. Anne’s Hospital and Good Samaritan Medical Center, since the church says Steward “acknowledged and agreed that the … names were ‘integrally related’ to the Hospitals’ Catholic identity.”
ATLANTA – The City of Atlanta’s former Chief Financial Officer, Jimmie “Jim” A. Beard, has been sentenced to federal prison for a multi-year scheme involving theft of funds, purchase and possession of two machine guns, and obstructing federal tax laws using altered documents and a fake business.
“Jim Beard abused the trust and confidence placed in him by the people of the City of Atlanta when he decided to steal tens of thousands of dollars from taxpayers to support his lavish lifestyle,” said U.S. Attorney Ryan K. Buchanan. “Beard’s sentencing is a demonstration of our commitment to hold accountable public officials who trade their position of power for greed and personal gain.”
“As this prosecution shows, the Department of Justice will work vigorously to protect the integrity of federal funds. Today’s sentence sends a strong message of deterrence to prevent fraud and theft from state and local governments receiving federal benefits,” said Principal Deputy Assistant Attorney General Nicole M. Argentieri.
“Beard’s actions eroded public trust in government. As one of the most powerful people in Atlanta city government, he stole tens of thousands of dollars from taxpayers so he could go on luxurious trips and even buy custom-made machine guns,” said Keri Farley, Special Agent in Charge of FBI Atlanta. “Public corruption is one of the FBI’s top priorities and we continue to work to protect citizens against officials who abuse that trust.”
“Public officials are entrusted by the citizens they serve to conduct the business of government on their behalf,” said Demetrius Hardeman, Special Agent in Charge, IRS Criminal Investigation, Atlanta Field Office. “Jim Beard failed in his responsibilities to the community and utilized public tax dollars to satisfy his greed. The sentence today reinforces IRS Criminal Investigation’s commitment to investigating and forwarding for prosecution those who commit financial fraud.”
“Beard repeatedly abused his position, broke the law he was sworn to uphold and betrayed the trust of the people of Atlanta,” said ATF Assistant Special Agent in Charge Alicia D. Jones. “This case demonstrates the partnerships of law enforcement to enforce the law and hold individuals accountable, regardless of their position or status.”
According to U.S. Attorney Buchanan, the charges and other information presented in court: From approximately November 2011 to May 2018, Beard served as the Chief Financial officer (“CFO”) of the City of Atlanta (the “City”). As CFO, Beard directed and managed the Department of Finance, with primary responsibility for oversight and management of the City’s financial condition, earning a salary of over $260,000 per year.
During his tenure, Beard devised and executed a scheme to obtain money and property from the City for private use, including using City funds to: (1) pay for personal luxury travel expenses for himself, his family, and his travel companions; (2) buy items for personal use, including two machine guns; (3) pay for travel to conferences or meetings for which the conference or meeting host reimbursed Beard, with Beard pocketing the reimbursements instead of giving them to the City; and (4) pay for travel that Beard falsely claimed as business deductions on his taxes for a non-existent personal consulting business.
In total, Beard stole at least tens of thousands of dollars from the City. By way of example only:
•In the summers of 2015 and 2016, Beard charged nearly $4,000 to the City for weekend stays at the J.W. Marriott Hotel in Chicago, Illinois. However, Beard was not in Chicago those weekends and the hotel rooms were actually for his stepdaughter to attend the Lollapalooza music festival.
•In December 2015, Beard ordered two custom-built machine guns using a purchase order and $2,641.90 check from the City, telling the manufacturer that the machine guns were for the exclusive use of the Atlanta Police Department (“APD”) – even though Beard took the guns to his own home and APD had no knowledge of them.
•In April 2016, Beard charged more than $2,600 to the City for airfare and hotels for two weekend trips to the New Orleans Jazz and Heritage Festival. Beard had no City business in New Orleans during either trip, and took his wife one of the weekends and a different personal companion the other.
•In June 2016, Beard charged $975.52 to the City for travel to Washington, D.C. for a meeting with the Municipal Securities Rulemaking Board (“MSRB”). Even though Beard had the City pay for this travel, Beard asked the MSRB to reimburse him personally for these costs and submitted copies of his receipts to the MSRB. As a result, the MSRB issued a check to Beard, which he kept and deposited into his personal bank account.
•In April 2017, Beard charged more than $10,000 to the City for a four-day stay for him and his wife at the Shangri-La Hotel in Paris, in a deluxe suite with a view of the Eiffel Tower.
Beard exploited his position and power to execute his scheme. When lower-level City staff members responsible for processing travel reimbursements asked him for receipts or work justifications for his trips, Beard refused and ordered the staff (who worked for him) to process the reimbursements without the requisite documentation. A City employee described the culture under Beard as, “if the [] CFO asks you for something, you do not ask questions.”
While CFO, Beard also submitted years of fraudulent tax returns in which he claimed personal business expenses to lower what he owed in taxes. During a 2015 audit of one of those returns, Beard lied to the IRS and obstructed auditors by submitting receipts for transactions that were actually paid by the City in connection with Beard’s official duties. The investigation later revealed that Beard did not operate a personal business, and years of tax deductions were based on a lie.
Jimmie “Jim” A. Beard, 60, of Fort Lauderdale, Florida was sentenced by U.S. District Judge Steve C. Jones to three years in prison to be followed by three years of supervised release. Beard was also ordered to pay a fine of $10,000 and restitution in the amount of $177,197.48. Beard was convicted on these charges on April 8, 2024, after he pleaded guilty.
This case was investigated by the Federal Bureau of Investigation and Internal Revenue Service Criminal Investigations, with assistance from the Bureau of Alcohol, Tobacco, Firearms and Explosives.
Assistant U.S. Attorneys Garrett Bradford and Tiffany Johnson, Department of Justice Trial Attorney Trevor Wilmot, and former Assistant U.S. Attorney Jeffrey Davis prosecuted the case.
Following a series of initiatives the IRS launched last year to pursue extremely wealthy tax evaders with a focus on individuals with more than $1 million in income and over $250,000 in debt, the organization announced that it has successfully collected $1 billion in back taxes. What do you think?
“Imagine how many corporate tax breaks you can give with that much money!”
Eli Orsi, Mug Tester
Eli Lilly Unveils Insulin That Doesn’t Work On Poor People
“The IRS better hope they don’t get audited.”
Mauricio Ibarra, Balloon Inflator
“This is exactly why I choose to remain unemployed.”
Washington (CNN) — The Internal Revenue Service said Thursday that it has collected more than $1 billion in past-due taxes from millionaires since last fall – thanks to a ramp up of enforcement efforts funded by the Democrat-backed Inflation Reduction Act that passed Congress nearly two years ago.
The Biden administration is eager to show how the IRS is using the money to crack down on wealthy tax cheats and improve taxpayers services. Republicans, who have criticized the funding as wasteful spending, have made several efforts to chip away at the 10-year investment provided by the legislation.
Last fall, the IRS launched an initiative to collect from wealthy individuals who have not paid the taxes they owe. The agency identified about 1,600 taxpayers with more than $1 million in income and more than $250,000 in tax debt. To date, more than $1 billion has been recovered from those individuals, and the effort is ongoing.
Prior to the Inflation Reduction Act, the IRS did not have the staffing or resources to pursue high-income earners that the agency knew owed taxes, IRS Commissioner Danny Werfel said on a call with reporters.
“The taxes were clearly owed by these people, but we didn’t have the people or the resources to follow up with them,” Werfel said.
The process of collecting past-due taxes starts with a letter to the taxpayer’s home. They are given a certain amount of time to either pay the back taxes or dispute the matter. The rest of the process varies depending on the taxpayer’s situation.
Targeting wealthy tax cheats
The IRS has launched a series of initiatives over the past two years to crack down on wealthy tax cheats.
For example, it is ramping up audits of wealthy taxpayers, corporations and large business partnerships by hiring more staff and using artificial intelligence. The agency is also examining the personal use of corporate jets.
Some of the funding from the Inflation Reduction Act is being used to modernize taxpayer services. As a result, the agency was able to answer 1 million more calls this year than it did during the previous tax season. Efforts to digitize the agency’s 1 billion pieces of paper are also underway.
Earlier this year, the IRS launched a pilot version of its own tax filing service that allowed Americans to file their returns for free directly with the IRS. More than 140,000 people used the program, known as Direct File, to successfully file their tax returns and the IRS plans to expand the program next year.
Battles over IRS funding
The Inflation Reduction Act, which passed without any Republican votes, approved about $80 billion for the IRS over a 10-year period.
But Republicans have made several efforts to claw back the money. In a deal to address the debt ceiling and avoid a US default last year, Democrats agreed to allow for $20 billion of the Inflation Reduction Act funds to be rescinded.
In January, Democrats conceded an acceleration of the $20 billion cut in an effort to get a full-year federal spending law passed in time to avoid a partial government shutdown.
BOSTON — Massachusetts lost more than $3.8 billion in state-adjusted gross income between 2021 and 2022 as residents fled to New Hampshire, Florida and other low-tax states, according to new Internal Revenue Service data.
The IRS data, based on income tax returns, shows the Bay State lost a net of more than 45,000 residents in the 2021 and 2022 calendar years – taking with them more than $3.9 billion in taxable income. That’s the fifth highest rate of domestic outmigration in the nation following New York, Illinois, New Jersey and California.
New Hampshire and Florida were the biggest beneficiaries of Massachusetts’ transplants, the IRS data shows. More than 18,189 people moved from New York to Florida, taking $1.4 billion. An additional 23,596 Bay Staters moved to Florida, bringing more than $2.8 billion in income with them, according to the IRS.
The Pioneer Institute, a Boston-based think tank, says the data shows the largest cohort to flee Massachusetts were 26- to 35 year-olds, with 9,500 more tax filers leaving than coming into Massachusetts in 2022, more than five times the number a decade earlier.
“This loss of young talent hinders the state’s future innovation and economic growth, which will compound over decades,” said Mary Connaughton, Pioneer’s director of government transparency. “The cost of housing is a leading factor and the recent housing bill is not enough to address this critical challenge.”
“We need more innovative solutions at the local level to adequately boost the state’s housing supply,” she added.
The report is the latest in the series that highlights how Massachusetts’ population is shrinking despite a continuing influx of new arrivals, many through immigration.
Still, the state’s outmigration appears to be slowing, with about 18,000 fewer residents leaving the state in 2023 than in 2022 – a 31% drop, according to the latest census data, released in May.
Experts say the outmigration has less to do with politics than it does with a lack of housing, prevailing wages and access to employment.
But federal data shows the population decline has major implications for the states, revenue and tax collections. The state has seen its revenue benchmarks from tax collections fall short over the past year.
Massachusetts lost an estimated $4.3 billion in state-adjusted gross income in 2020-21 tax year as residents fled to other low-tax states, according to the latest IRS figures.
On Beacon Hill, state leaders have approved proposals to cut taxes and reduce the state’s high cost of living as part of a broader effort to stop outward migration and make the state more attractive to new families and businesses.
Gov. Maura Healey, a first-term Democrat, has expressed concerns about the exodus of residents and businesses in the wake of the COVID-19 pandemic.
Healey has pointed to a lack of housing as a primary reason people are leaving the state, making the case for expanding stock and making homes more affordable. She acknowledged the impact of the housing crunch on outmigration at an event in Lowell, where she and other officials announced $27 million in tax credits for new housing developments in Salem, Lawrence and Haverhill and other “Gateway” cities.
“I love New Hampshire, but I want people to stay here in Massachusetts,” Healey said in remarks Tuesday. “I don’t want them going north of the border.”
But critics point to the state’s high tax burden, including the voter-approved “millionaires tax” that set a new 4% surtax for people with incomes above $1 million a year. They say despite a tax reform package signed by Healey last year, the state needs to do more to ease the burden on residents and businesses.
Others say concerns about outmigration are overblown and point out that people leave the state for new jobs, college and other reasons other than consternation over high taxes, the cost of living or the lack of affordable homes.
A 2023 report by the left-leaning policy group Massachusetts Budget and Policy Center says IRS data from 2020 to 2021 shows that Massachusetts has a lower rate of outmigration among high-income households earning $200,000 or more a year than that of low- and middle-income households.
The report’s authors say that data suggests state tax levels have had “little impact” on the decisions of high-income households.
Christian M. Wade covers the Massachusetts Statehouse for North of Boston Media Group’s newspapers and websites. Email him at cwade@cnhinews.com.
World War II Air Force veteran Major Richard Olson never discussed his military service with his son, Dick Olson.
“I didn’t have all that much time to be asking these questions while he was at home,” Dick, a Westminster resident, told the Denver Post in an interview. “He was a distant father, and I imagine a lot of that came from what happened to him during the war and in service.”
After Richard died, Dick turned to military archives, old photos and interviews with the surviving members of his father’s B-24 Liberator airplane crew to learn about the veteran’s journey. Through his research, Dick discovered that his father, despite being seriously injured in a plane crash before enduring months as a prisoner of war, had never received a Purple Heart.
World War II Air Force veteran Major Richard Olson never discussed his military service with his son, Dick Olson.
“I didn’t have all that much time to be asking these questions while he was at home,” Dick, a Westminster resident, told the Denver Post in an interview. “He was a distant father, and I imagine a lot of that came from what happened to him during the war and in service.”
After Richard died, Dick turned to military archives, old photos and interviews with the surviving members of his father’s B-24 Liberator airplane crew to learn about the veteran’s journey. Through his research, Dick discovered that his father, despite being seriously injured in a plane crash before enduring months as a prisoner of war, had never received a Purple Heart.
For seven years, Dick worked to correct the oversight. In April, the Air Force agreed to posthumously award Richard a Purple Heart.
The veteran was 22 years old when he enlisted in the U.S. Army Air Corps in February 1941, according to his son. The service was renamed the U.S. Army Air Forces in June of that year and became the U.S. Air Force in 1947.
“He grew up through the Depression and everything else,” Dick told The Post. “I think he joined because he was looking for three square meals a day.”
Courtesy of Dick Olson
Richard Olson (bottom center) poses with a B-24 crew after completing a six hour training flight. (Photo credit: Courtesy of Dick Olson)
Olson later became the co-pilot of a B-24 bomber plane in the 484th Bombardment Group combat unit. A week after D-Day, while stationed in southern Italy, his crew was shot down over the Adriatic Sea by eight German fighter planes while flying to Munich.
“They lost an engine, and they couldn’t keep up with the rest of the bombers, so they had to turn around to go back,” Dick said. “Two of the gunners were killed on the plane. And then the plane was set on fire and I think they had two more engines shot out.
“But there was a big fire in the bomb bay so they had to get out of the plane. So they did, and everybody bailed out, the ones that were still alive.”
Shell fragments struck Olson’s leg and he sustained a back injury that left him with chronic pain.
Most of the men landed on the Italian coastline northeast of Venice, according to conversations Dick had with B-24 crew member John Hassan. He was transferred to two other POW camps and after 10 months of incarceration, Olson was liberated on April 29, 1945, from Moosburg, Germany.
“He just said it was a very dull existence and of course they were hungry all the time,” Dick told The Post. “There was not a whole lot to do there. They played sports and the American Red Cross supplied them with books and boardgames and sporting equipment and different things to keep their morale up.”
Courtesy of Dick Olson
Richard Olson’s identification card from his time as a POW in Stalag Luft III. (Photo credit: Courtesy of Dick Olson)
Olson stayed in the Air Force for 16 years after his liberation from the POW camp and became a major, father and husband before leaving the military in 1961, according to his obituary.
“My parents split when I was about 13,” Dick said. “He moved away from the household and they got divorced.”
After the divorce in 1969, Dick saw Richard three more times before the veteran passed away in 1996 from multiple myeloma.
“I was always interested in his Air Force career. And since he never talked about these other guys, I wanted to find them and talk to them myself,” Dick said.
He connected with John Hassan, the navigator in Richard’s B-24 crew, in 1997. “Going through some of his papers, I found a phone number for John and called him up and started looking for all the other crew members also,” Dick said, “I eventually did make contact with the ones that were living or family members for the ones who had passed away.
“John was my dad’s best friend on the crew and we became really good friends,” Dick added. “He pretty much had a photographic memory, so that’s how I know an awful lot about that crew.”
While researching the crew, Dick helped the plane’s bombardier, Walter Chapman, get a Distinguished Flying Cross he should have been awarded decades prior.
Like Chapman, Olson was also missing an award: a Purple Heart for sustaining an injury while in the line of duty.
“There was mention of everything else, like the Distinguished Flying Cross and Air Medals,” Dick said. “All the ribbons and medals that he was entitled to, except for the Purple Heart.”
A collection of medals, honors and other items made by Dick Olson for his late father WWII veteran Major Richard Olson at his home in Westminster, Colorado, on Jun 19, 2024. (Photo by Helen H. Richardson/The Denver Post)
Olson’s capture as a POW right after the B-24 crash meant his wounds went undocumented. In 2017, Dick decided to file a claim with the Air Force Board for Correction of Military Records and prove that his father had been injured. “I thought to myself, this is unfinished business, I’ve got to see if I can get this thing,” Dick said.
After an extensive filing process, the Board for Correction rejected Dick’s request in 2020.
Brian Schenk, founder of Midwest Military and Veterans Law, agreed to work with Dick pro bono and together, they took the Board for Correction to federal court, determined to prove that Olson had been injured during active duty.
“Dick Olson’s father was a war hero and he had such extreme humility that he himself never sought a Purple Heart,” Schenk told the Denver Post.
“I thought to myself, the old man went through the wringer, and he deserves to have this,” Dick said. “I told the Air Force in the letter that I wrote with my first application that I’m doing it for his legacy and for posterity. People should know that he was injured fighting for his country.”
On April 23, Dick won his case and the Board for Correction agreed to posthumously grant Olson a Purple Heart Award.
“He would have been real happy to wear this purple heart,” Dick said. “I think he would have been pretty proud of the fight we put up to make this happen.”
